The ESG, Sustainability & Impact Measurement and Management (IMM) market has evolved over the last 2 decades as global economies usheran era often called Capitalism 2.0, Impact Economy, Impact Capitalism, Stakeholder Capitalism or even Conscious Capitalism. This new and evolving systemic paradigm necessitates ESG, Sustainability and Impact goals, assessment, and reporting transparency alongside financial goals. Aspire Circle and Aspire Impact, established in India in 2007 and 2020 respectively, under the aegis of their Impact Future Project have recognized that IMM has globally grown from $2 billion in 2010 to $7.7 billion in 2020, a 4X growth in 10 years. IMM is expected to continue the trajectory and with 15% CAGR, deliver a whopping $31.2 billion IMM market 2030. Notably, India will be a significant IMM market in Asia-Pacific, along with Singapore.
All this and more was revealed in a comprehensive and well-researched market-sizing study titled The Size of ESG, Sustainability and Impact Measurement & Management Market, authored by Amit Bhatia & Harpreet Kaur Ghai, and released by Aspire Circle and Aspire Impact, the foremost Impact Leadership & ecosystem development pioneers in India. Based on a sample of 550+ organizations and using bottom-up forecasting method, it is the world’s first market-sizing study for the integrated ESG, Sustainability, & Impact sector. And of the 550 plus players profiled, more than 50 were based in India. The publication of this study on IMM is also significant and timely in light of a series of inaccurate and misleading ESG ratings and scores given by some of the top global rating agencies to top multinational companies in recent years.
Earlier in 2020, Aspire Circle and Aspire Impact, both founded by Amit Bhatia, had launched India and the Global South’s first set of Impact Standards for corporations and non-profit using an independent, standards-based 4P (Product, People, Planet & Policy) framework with 150 plus KPIs. For its part, the Indian government modified the erstwhile Business Responsibility Reporting (BRR)into Business Responsibility & Sustainability Reporting (BRSR) in 2021-22, which was initially voluntary, but has been made mandatory for top 1000 listed companies from FY 2022-23 onwards. Aspire Impact will launch its ESG Impact Ratings & ESG Risk Ratings during FY24.
With regulators worldwide pivoting towards mandatory ESG and Sustainability reporting from the hitherto voluntary disclosures, coupled with persistent prodding by an increasingly conscientious consumer society, the impact economy and the broader impact movement has accelerated as well as resonated throughout the world. As a result, there has been stupendous growth in the number of players either entering the market for the first time, or existing businesses diversifying into ESG, Sustainability, & Impact. However simultaneously, there has also been a proliferation of frameworks, standards, approaches, principles, methodologies, technologies, etc leading not just to a problem of plenty and fragmentation of the market, but also delaying global consensus on standardization for impact measurement. With this in mind, the study apart from ‘sizing up’ the market across geographies also outlines fixed distinct segments constituting a well-developed IMM ecosystem. They are as follows: IMM Consulting and Services; Databases, Indices, Ratings and Rankings; Software and Technology; Executive Education & Training; and Principles, Frameworks, Standards and Coalitions. According to the study, while Databases, Indices, Ratings, and Rankings segments to grow the steepest at 30% CAGR followed by IMM Software and Technology market at 22% CAGR, IMM Consulting and Services and Executive Education & Training segments would grow at 11% CAGR each by 2030.
“We are very delighted to release this market-sizing study on the global IMM market, a first for the world. This report creates a $7.7 billion IMM umbrella that unites ESG, Sustainability & Impact intermediaries; segments the IMM industry into five distinct sub-sectors; and foretells the imminent consolidation by analyzing 80+ M&A deals worth over$100 billion. Finally, IMM can play a significant role in India and other emerging markets, driving inclusive growth, achieving SDGs, and her 2070 net-zero target,” said Mr. Amit Bhatia, Founder and CEO, Aspire Impact.
Sir Ronald Cohen (President & Co-Founder- GSG) authored the Foreword, and global Impact leaders like Cliff Prior (CEO- GSG), Fran Seegull (CEO-US Impact Investing Alliance), Prof. Rosemary Addis, University of Melbourne, Navneet Munot (MD & CEO HDFC Asset Management), Visalakshi Chandramouli, Managing Partner- Tata Capital Healthcare Fund, and, Anurag Pratap, VP & CSR Leader- Capgemini- sponsor of IFP, all published messages in the research publication. Capgemini has been dedicated to supporting Aspire in conducting ground-breaking research within the impact economy ecosystem since 2020, showcasing their commitment to advancing research initiatives in this field.
Navneet Munot said, “The need to act now, to care for the planet and create far-reaching positive impact, above and beyond, is now an urgent necessity. This Impact Future Project report is an important contribution to the sustainability movement-a valuable resource for anyone who wants to get a comprehensive overview of the ESG, Sustainability & Impact.”
Harpreet Kaur, co-author of the research said, “Given the nascent nature of the global IMM industry, both for-profits and non profits are somehow struggling to navigate through the complex array of new regulations, reporting standards, tools and methods that are cropping up today fairly frequently. This study is not only an important exercise in market-sizing but also serves as a ready reckoner of sorts for anyone looking to understand how the IMM and its different segments work.”